Fixed Establishments in European VAT - BEPS's Side Effects

Abstract

The focus in the reports of the OECD in its Base Erosion and Profit Shifting (BEPS) project is direct taxation. Still, the effects BEPS will have on indirect taxes must not be underestimated. In this article the author addresses the effects that the BEPS reports and developments will have on the concept of fixed establishment for indirect taxes. On the one hand, she discusses the changes in the concept of permanent establishment (PE) and how they might affect the interpretation of the concept of fixed establishment (FE) for VAT purposes. On the other hand, she discusses whether or not the issues addressed in BEPS for PEs may be required to address for European VAT in a similar manner for FEs.